Anthem's Medical Loss Ratio (MLR) Update for California

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Jul 09, 2012

Medical loss ratio update for California

The Affordable Care Act (health care reform law) requires health plans to meet a minimum medical loss ratio, which varies according to market. Health insurance issuers must meet a minimum medical loss ratio of 85% in the fully insured large group market and 80% in the fully insured small group and individual markets. (States that received waivers to have a lower threshold for the individual market are required to meet that percentage, not the 80% in the Affordable Care Act.)

The health care reform law also requires health plans to file a medical loss ratio report each year with the Department of Health and Human Services. On June 1, 2012, Anthem Blue Cross filed the required report for the 2011 calendar year.

Anthem met the required loss ratio in the large group market and in the small group market for the California Department of Insurance (CDI). However, they did not meet the required loss ratio for the individual market with the CDI. Additionally, the large group and individual markets for the Department of Managed Health Care (DMHC) met the required loss ratio, but the small group market for the DMHC did not. This means members in the large group market will get postcards with the information notifying them that we met the minimum medical loss ratio and no rebate will be issued as required by law.

In the individual market for Anthem Blue Cross Life and Health Insurance Company products and small group market for the Blue Cross of California products Anthem will send the required notification along with the rebate check to the member or employer as required by law. Enrollees in the employer health plans will also receive the notification.